to
attract and retain the best available personnel for positions of substantial
responsibility,

•

to
provide additional incentive to Employees, Directors and Consultants, and

•

to promote the success of the Company’s business.

Options
granted under the Plan may be Incentive Stock Options or Nonstatutory
Stock Options, as determined by the Administrator at the time of grant. Stock
Purchase Rights may also be granted under the Plan.

2. Definitions.
As used herein, the following definitions shall apply:

(a) “Administrator”
means the Board or any of its Committees as shall be administering the Plan, in
accordance with Section 4 of the Plan.

(b) “Applicable
Laws” means the requirements relating to the administration of stock option
plans under U. S. state corporate laws, U.S. federal and state securities laws,
the Code, any stock exchange or quotation system on which the Common Stock is
listed or quoted and the applicable laws of any foreign country or jurisdiction
where Options or Stock Purchase Rights are, or will be, granted under the Plan.

(c) “Board”
means the Board of Directors of the Company.

(d) “Code”
means the Internal Revenue Code of 1986, as amended.

(e) “Committee”
means a committee of Directors appointed by the Board in accordance with
Section 4 of the Plan.

(h) “Consultant”
means any person, including an advisor, engaged by the Company or a Parent or
Subsidiary to render services to such entity.

(i) “Director” means a member of the Board.

(j) “Disability”
means total and permanent disability as defined in Section 22(e)(3) of the Code.

(k) “Employee”
means any individual, including Officers and Directors, employed by the Company
or any Parent or Subsidiary of the Company. For purposes of the Plan, the
employment relationship shall be treated as continuing intact while the
individual (i) is on any bona fide leave of
absence approved by the Company or (ii) transfers between locations of the
Company or between the Company, its Parent, any Subsidiary, or any successor.
Neither service as a Director nor payment of a director’s fee by the Company
shall be sufficient to constitute “employment” by the Company.

(m) “Fair
Market Value” means, as of any date, the value of Common Stock determined
as follows:

(i) If the Common Stock is listed on any established
stock exchange or a national market system, including without limitation the Nasdaq National Market or The NasdaqSmallCap Market of The Nasdaq
Stock Market, its Fair Market Value shall be the closing sales price for such
stock (or the closing bid, if no sales were reported) as quoted on such
exchange or system for the last market trading day on the date of such
determination, as reported in The Wall Street Journal or such other
source as the Administrator deems reliable;

(ii) If
the Common Stock is regularly quoted by a recognized securities dealer but
selling prices are not reported, the Fair Market Value of a Share of Common
Stock shall be the mean between the high bid and low asked prices for the
Common Stock on the last market trading day prior to the day of determination,
as reported in The Wall Street Journal or such other source as the
Administrator deems reliable; or

(iii) In
the absence of an established market for the Common Stock, the Fair Market
Value shall be determined in good faith by the Administrator.

(n) “Incentive
Stock Option” means an Option intended to qualify as an incentive stock
option within the meaning of Section 422 of the Code and the regulations
promulgated thereunder.

(o) “Nonstatutory Stock Option” means an Option
not intended to qualify as an Incentive Stock Option.

(p) “Notice
of Grant” means a written or electronic notice evidencing certain terms and
conditions of an individual Option or Stock Purchase Right grant. The Notice of
Grant is part of the Option Agreement.

(q) “Officer”
means a person who is an officer of the Company within the meaning of
Section 16 of the Exchange Act and the rules and regulations promulgated thereunder.

(r) “Option”
means a stock option granted pursuant to the Plan.

(s) “Option
Agreement” means an agreement between the Company and an Optionee evidencing the terms and conditions of an
individual Option grant. The Option Agreement is subject to the terms and
conditions of the Plan.

(t) “Option
Exchange Program” means a program whereby outstanding Options are
surrendered in exchange for Options with a lower exercise price.

(u) “Optioned
Stock” means the Common Stock subject to an Option or Stock Purchase Right.

(v) “Optionee” means the holder of an outstanding Option
or Stock Purchase Right granted under the Plan.

(w) “Parent”
means a “parent corporation,” whether now or hereafter existing, as defined in
Section 424(e) of the Code.

(x) “Plan”
means this 1999 Stock Plan.

(y) “Restricted
Stock” means shares of Common Stock acquired pursuant to a grant of Stock
Purchase Rights under Section 11 of the Plan.

(z) “Restricted
Stock Purchase Agreement” means a written agreement between the Company and
the Optionee evidencing the terms and restrictions
applying to stock purchased under a Stock Purchase Right. The Restricted Stock
Purchase Agreement is subject to the terms and conditions of the Plan and the Notice
of Grant.

(aa) “Rule 16b-3”
means Rule 16b-3 of the Exchange Act or any successor to Rule 16b-3,
as in effect when discretion is being exercised with respect to the Plan.

(bb) “Section 16(b)” means Section 16(b) of
the Exchange Act.

(cc) “Service
Provider” means an Employee, Director or Consultant.

(dd) “Share” means a
share of the Common Stock, as adjusted in accordance with Section 13 of the
Plan.

(ee) “Stock Purchase Right”
means the right to purchase Common Stock pursuant to Section 11 of the
Plan, as evidenced by a Notice of Grant.

(ff) “Subsidiary” means a “subsidiary
corporation”, whether now or hereafter existing, as defined in Section 424(f)
of the Code.

3. Stock
Subject to the Plan. Subject to the provisions of Section 13 of the
Plan, the maximum aggregate number of Shares which may be optioned and sold
under the Plan is 7,607,000 Shares [60,856,000 Shares as adjusted for

-2-

three 2:1 stock
splits effective on or prior to 12/21/00], plus an annual increase to be added
on the first day of the Company’s fiscal year beginning in 2000 equal to the
lesser of (i) 5,000,000 shares [40,000,000
shares as adjusted for three 2:1 stock splits effective on or prior to 12/21/00],
(ii) 5% of the outstanding shares on such date or (iii) a lesser
amount determined by the Board. The Shares may be authorized, but unissued,
or reacquired Common Stock.

If
an Option or Stock Purchase Right expires or becomes unexercisable
without having been exercised in full, or is surrendered pursuant to an Option
Exchange Program, the unpurchased Shares which were
subject thereto shall become available for future grant or sale under the Plan
(unless the Plan has terminated); provided, however, that Shares that
have actually been issued under the Plan, whether upon exercise of an Option or
Right, shall not be returned to the Plan and shall not become available for
future distribution under the Plan, except that if Shares of Restricted Stock are
repurchased by the Company at their original purchase price, such Shares shall
become available for future grant under the Plan.

4. Administration
of the Plan.

(a) Procedure.

(i) Multiple Administrative Bodies. The Plan may
be administered by different Committees with respect to different groups of
Service Providers.

(ii) Section 162(m).
To the extent that the Administrator determines it to be desirable to qualify
Options granted hereunder as “performance-based compensation” within the
meaning of Section 162(m) of the Code, the Plan shall be administered by a
Committee of two or more “outside directors” within the meaning of Section
162(m) of the Code.

(iii) Rule 16b-3.
To the extent desirable to qualify transactions hereunder as exempt under
Rule 16b-3, the transactions contemplated hereunder shall be structured to
satisfy the requirements for exemption under Rule 16b-3.

(iv) Other Administration. Other than as
provided above, the Plan shall be administered by (A) the Board or
(B) a Committee, which committee shall be constituted to satisfy
Applicable Laws.

(b) Powers
of the Administrator. Subject to the provisions of the Plan, and in the
case of a Committee, subject to the specific duties delegated by the Board to
such Committee, the Administrator shall have the authority, in its discretion:

(i) to determine the Fair
Market Value;

(ii) to select the Service Providers to whom Options and Stock
Purchase Rights may be granted hereunder;

(iii) to determine the number of shares of Common Stock to be
covered by each Option and Stock Purchase Right granted hereunder;

(iv) to approve forms of agreement for use under the Plan;

(v) to determine the terms and conditions, not inconsistent with
the terms of the Plan, of any Option or Stock Purchase Right granted hereunder.
Such terms and conditions include, but are not limited to, the exercise price,
the time or times when Options or Stock Purchase Rights may be exercised (which
may be based on performance criteria), any vesting acceleration or waiver of
forfeiture restrictions, and any restriction or limitation regarding any Option
or Stock Purchase Right or the shares of Common Stock relating thereto, based
in each case on such factors as the Administrator, in its sole discretion,
shall determine;

(vi) to reduce the exercise price of any Option or Stock Purchase
Right to the then current Fair Market Value if the Fair Market Value of the
Common Stock covered by such Option or Stock Purchase Right shall have declined
since the date the Option or Stock Purchase Right was granted;

(vii) to institute an Option Exchange Program;

(viii) to construe and interpret the terms of the Plan and awards
granted pursuant to the Plan;

-3-

(ix) to
prescribe, amend and rescind rules and regulations relating to the Plan, including
rules and regulations relating to sub-plans established for the purpose of
qualifying for preferred tax treatment under foreign tax laws;

(x) to
modify or amend each Option or Stock Purchase Right (subject to Section 15(c)
of the Plan), including the discretionary authority to extend the
post-termination exercisability period of Options
longer than is otherwise provided for in the Plan;

(xi) to
allow Optionees to satisfy withholding tax
obligations by electing to have the Company withhold from the Shares to be
issued upon exercise of an Option or Stock Purchase Right that number of Shares
having a Fair Market Value equal to the amount required to be withheld. The
Fair Market Value of the Shares to be withheld shall be determined on the date
that the amount of tax to be withheld is to be determined. All elections by an Optionee to have Shares withheld for this purpose shall be
made in such form and under such conditions as the Administrator may deem
necessary or advisable;

(xii) to authorize any person to execute on behalf of the Company
any instrument required to effect the grant of an Option or Stock Purchase
Right previously granted by the Administrator;

(xiii) to make all other determinations deemed necessary or
advisable for administering the Plan.

(c) Effect of Administrator’s Decision. The
Administrator’s decisions, determinations and interpretations shall be final
and binding on all Optionees and any other holders of
Options or Stock Purchase Rights.

5. Eligibility.
Nonstatutory Stock Options and Stock Purchase Rights
may be granted to Service Providers. Incentive Stock Options may be granted
only to Employees.

6. Limitations.

(a) Each
Option shall be designated in the Option Agreement as either an Incentive Stock
Option or a Nonstatutory Stock Option. However,
notwithstanding such designation, to the extent that the aggregate Fair Market
Value of the Shares with respect to which Incentive Stock Options are
exercisable for the first time by the Optionee during
any calendar year (under all plans of the Company and any Parent or Subsidiary)
exceeds $100,000, such Options shall be treated as Nonstatutory
Stock Options. For purposes of this Section 6(a), Incentive Stock Options
shall be taken into account in the order in which they were granted. The Fair
Market Value of the Shares shall be determined as of the time the Option with
respect to such Shares is granted.

(b) Neither
the Plan nor any Option or Stock Purchase Right shall confer upon an Optionee any right with respect to continuing the Optionee’s relationship as a Service Provider with the
Company, nor shall they interfere in any way with the Optionee’s
right or the Company’s right to terminate such relationship at any time, with
or without cause.

(c) The
following limitations shall apply to grants of Options:

(i) No Service Provider shall be granted, in any fiscal
year of the Company, Options to purchase more than 1.5 million Shares.

(ii) In
connection with his or her initial service, a Service Provider may be granted
Options to purchase up to an additional 1.5 million Shares which shall not
count against the limit set forth in subsection (i) above.

(iii) The
foregoing limitations shall be adjusted proportionately in connection with any
change in the Company’s capitalization as described in Section 13.

(iv) If an Option is cancelled in the same fiscal year
of the Company in which it was granted (other than in connection with a
transaction described in Section 13), the cancelled Option will be counted
against the limits set forth in subsections (i) and
(ii) above. For this purpose, if the exercise price of an Option is
reduced, the transaction will be treated as a cancellation of the Option and
the grant of a new Option.

7. Term
of Plan. Subject to Section 19 of the Plan, the Plan shall become
effective upon its adoption by the Board. It shall continue in effect for a
term of ten (10) years unless terminated earlier under Section 15 of
the Plan.

-4-

8. Term
of Option. The term of each Option shall be stated in the Option Agreement.
In the case of an Incentive Stock Option, the term shall be ten (10) years
from the date of grant or such shorter term as may be provided in the Option
Agreement. Moreover, in the case of an Incentive Stock Option granted to an Optionee who, at the time the Incentive Stock Option is
granted, owns stock representing more than ten percent (10%) of the total
combined voting power of all classes of stock of the Company or any Parent or
Subsidiary, the term of the Incentive Stock Option shall be five (5) years
from the date of grant or such shorter term as may be provided in the Option
Agreement.

9. Option
Exercise Price and Consideration.

(a) Exercise
Price. The per share exercise price for the Shares to be issued pursuant to
exercise of an Option shall be determined by the Administrator, subject to the
following:

(i) In the case of an Incentive Stock Option

(A) granted
to an Employee who, at the time the Incentive Stock Option is granted, owns
stock representing more than ten percent (10%) of the voting power of all
classes of stock of the Company or any Parent or Subsidiary, the per Share
exercise price shall be no less than 110% of the Fair Market Value per Share on
the date of grant.

(B) granted
to any Employee other than an Employee described in paragraph
(A) immediately above, the per Share exercise price shall be no less than
100% of the Fair Market Value per Share on the date of grant.

(ii) In
the case of a Nonstatutory Stock Option, the per Share exercise price shall be determined by the
Administrator. In the case of a Nonstatutory Stock
Option intended to qualify as “performance-based compensation” within the
meaning of Section 162(m) of the Code, the per Share exercise price shall be no
less than 100% of the Fair Market Value per Share on the date of grant.

(iii) Notwithstanding
the foregoing, Options may be granted with a per Share exercise price of less
than 100% of the Fair Market Value per Share on the date of grant pursuant to a
merger or other corporate transaction.

(b) Waiting
Period and Exercise Dates. At the time an Option is granted, the
Administrator shall fix the period within which the Option may be exercised and
shall determine any conditions which must be satisfied before the Option may be
exercised.

(c) Form
of Consideration. The Administrator shall determine the acceptable form of
consideration for exercising an Option, including the method of payment. In the
case of an Incentive Stock Option, the Administrator shall determine the
acceptable form of consideration at the time of grant. Such consideration may
consist entirely of:

(i) cash;

(ii) check;

(iii) other
Shares which (A) in the case of Shares acquired upon exercise of an
option, have been owned by the Optionee for more than
six months on the date of surrender, and (B) have a Fair Market Value on
the date of surrender equal to the aggregate exercise price of the Shares as to
which said Option shall be exercised;

(iv) consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan;

(v) a reduction in the amount of any Company liability to the Optionee, including any liability attributable to the Optionee’s participation in any Company-sponsored deferred
compensation program or arrangement;

(vi) any combination of the foregoing methods of payment; or

(vii) such other consideration and method of payment for the
issuance of Shares to the extent permitted by Applicable Laws.

-5-

10. Exercise
of Option.

(a) Procedure for Exercise; Rights as a Shareholder.
Any Option granted hereunder shall be exercisable according to the terms of the
Plan and at such times and under such conditions as determined by the
Administrator and set forth in the Option Agreement. Unless the Administrator
provides otherwise, vesting of Options granted hereunder shall be tolled during
any unpaid leave of absence. An Option may not be exercised for a fraction of a
Share.

An
Option shall be deemed exercised when the Company receives: (i) written or electronic notice of exercise (in
accordance with the Option Agreement) from the person entitled to exercise the
Option, and (ii) full payment for the Shares with respect to which the
Option is exercised. Full payment may consist of any consideration and method
of payment authorized by the Administrator and permitted by the Option
Agreement and the Plan. Shares issued upon exercise of an Option shall be
issued in the name of the Optionee or, if requested
by the Optionee, in the name of the Optionee and his or her spouse. Until the Shares are issued
(as evidenced by the appropriate entry on the books of the Company or of a duly
authorized transfer agent of the Company), no right to vote or receive
dividends or any other rights as a shareholder shall exist with respect to the
Optioned Stock, notwithstanding the exercise of the Option. The Company shall
issue (or cause to be issued) such Shares promptly after the Option is
exercised. No adjustment will be made for a dividend or other right for which
the record date is prior to the date the Shares are issued, except as provided
in Section 13 of the Plan.

Exercising
an Option in any manner shall decrease the number of Shares thereafter
available, both for purposes of the Plan and for sale under the Option, by the
number of Shares as to which the Option is exercised.

(b) Termination
of Relationship as a Service Provider. If an Optionee
ceases to be a Service Provider, other than upon the Optionee’s
death or Disability, the Optionee may exercise his or
her Option within such period of time as is specified in the Option Agreement
to the extent that the Option is vested on the date of termination (but in no
event later than the expiration of the term of such Option as set forth in the
Option Agreement). In the absence of a specified time in the Option Agreement,
the Option shall remain exercisable for three (3) months following the Optionee’s termination. If, on the date of termination, the
Optionee is not vested as to his or her entire
Option, the Shares covered by the unvested portion of the Option shall revert
to the Plan. If, after termination, the Optionee does
not exercise his or her Option within the time specified by the Administrator,
the Option shall terminate, and the Shares covered by such Option shall revert
to the Plan.

(c) Disability
of Optionee. If an Optionee
ceases to be a Service Provider as a result of the Optionee’s
Disability, the Optionee may exercise his or her
Option within such period of time as is specified in the Option Agreement to
the extent the Option is vested on the date of termination (but in no event
later than the expiration of the term of such Option as set forth in the Option
Agreement). In the absence of a specified time in the Option Agreement, the
Option shall remain exercisable for twelve (12) months following the Optionee’s termination. If, on the date of termination, the
Optionee is not vested as to his or her entire
Option, the Shares covered by the unvested portion of the Option shall revert
to the Plan. If, after termination, the Optionee does
not exercise his or her Option within the time specified herein, the Option
shall terminate, and the Shares covered by such Option shall revert to the
Plan.

(d) Death
of Optionee. If an Optionee
dies while a Service Provider, the Option may be exercised within such period
of time as is specified in the Option Agreement (but in no event later than the
expiration of the term of such Option as set forth in the Notice of Grant), by
the Optionee’s estate or by a person who acquires the
right to exercise the Option by bequest or inheritance, but only to the extent
that the Option is vested on the date of death. In the absence of a specified
time in the Option Agreement, the Option shall remain exercisable for twelve
(12) months following the Optionee’s termination. If,
at the time of death, the Optionee is not vested as
to his or her entire Option, the Shares covered by the unvested portion of the
Option shall immediately revert to the Plan. The Option may be exercised by the
executor or administrator of the Optionee’s estate
or, if none, by the person(s) entitled to exercise the Option under the Optionee’s will or the laws of descent or distribution. If
the Option is not so exercised within the time specified herein, the Option
shall terminate, and the Shares covered by such Option shall revert to the
Plan.

(e) Buyout
Provisions. The Administrator may at any time offer to buy out for a
payment in cash or Shares an Option previously granted based on such terms and conditions
as the Administrator shall establish and communicate to the Optionee
at the time that such offer is made.

-6-

11. Stock
Purchase Rights.

(a) Rights
to Purchase. Stock Purchase Rights may be issued either alone, in addition
to, or in tandem with other awards granted under the Plan and/or cash awards
made outside of the Plan. After the Administrator determines that it will offer
Stock Purchase Rights under the Plan, it shall advise the offeree
in writing or electronically, by means of a Notice of Grant, of the terms,
conditions and restrictions related to the offer, including the number of
Shares that the offeree shall be entitled to
purchase, the price to be paid, and the time within which the offeree must accept such offer. The offer shall be accepted
by execution of a Restricted Stock Purchase Agreement in the form determined by
the Administrator.

(b) Repurchase
Option. Unless the Administrator determines otherwise, the Restricted Stock
Purchase Agreement shall grant the Company a repurchase option exercisable upon
the voluntary or involuntary termination of the purchaser’s service with the
Company for any reason (including death or Disability). The purchase price for
Shares repurchased pursuant to the Restricted Stock Purchase Agreement shall be
the original price paid by the purchaser and may be paid by cancellation of any
indebtedness of the purchaser to the Company. The repurchase option shall lapse
at a rate determined by the Administrator.

(c) Other
Provisions. The Restricted Stock Purchase Agreement shall contain such
other terms, provisions and conditions not inconsistent with the Plan as may be
determined by the Administrator in its sole discretion.

(d) Rights
as a Shareholder. Once the Stock Purchase Right is exercised, the purchaser
shall have the rights equivalent to those of a shareholder, and shall be a
shareholder when his or her purchase is entered upon the records of the duly
authorized transfer agent of the Company. No adjustment will be made for a
dividend or other right for which the record date is prior to the date the
Stock Purchase Right is exercised, except as provided in Section 13 of the
Plan.

12. Non-Transferability
of Options and Stock Purchase Rights. Unless determined otherwise by the
Administrator, an Option or Stock Purchase Right may not be sold, pledged,
assigned, hypothecated, transferred, or disposed of in any manner other than by
will or by the laws of descent or distribution and may be exercised, during the
lifetime of the Optionee, only by the Optionee. If the Administrator makes an Option or Stock
Purchase Right transferable, such Option or Stock Purchase Right shall contain
such additional terms and conditions as the Administrator deems appropriate.

(a) Changes in Capitalization. Subject to any
required action by the shareholders of the Company, the number of shares of
Common Stock covered by each outstanding Option and Stock Purchase Right, and
the number of shares of Common Stock which have been authorized for issuance
under the Plan but as to which no Options or Stock Purchase Rights have yet
been granted or which have been returned to the Plan upon cancellation or
expiration of an Option or Stock Purchase Right, as well as the price per share
of Common Stock covered by each such outstanding Option or Stock Purchase
Right, shall be proportionately adjusted for any increase or decrease in the number
of issued shares of Common Stock resulting from a stock split, reverse stock
split, stock dividend, combination or reclassification of the Common Stock, or
any other increase or decrease in the number of issued shares of Common Stock
effected without receipt of consideration by the Company; provided, however,
that conversion of any convertible securities of the Company shall not be
deemed to have been “effected without receipt of consideration.” Such
adjustment shall be made by the Board, whose determination in that respect
shall be final, binding and conclusive. Except as expressly provided herein, no
issuance by the Company of shares of stock of any class, or securities
convertible into shares of stock of any class, shall affect, and no adjustment
by reason thereof shall be made with respect to, the number or price of shares
of Common Stock subject to an Option or Stock Purchase Right.

(b) Dissolution
or Liquidation. In the event of the proposed dissolution or liquidation of
the Company, the Administrator shall notify each Optionee
as soon as practicable prior to the effective date of such proposed
transaction. The Administrator in its discretion may provide for an Optionee to have the right to exercise his or her Option
until ten (10) days prior to such transaction as to all of the Optioned
Stock covered thereby, including Shares as to which the Option would not
otherwise be exercisable. In addition, the Administrator may provide that any
Company repurchase option applicable to any Shares purchased upon exercise of
an Option or Stock Purchase Right shall lapse as to all such Shares, provided
the proposed dissolution or liquidation takes place at the time and in the
manner

-7-

contemplated. To the extent it has not been
previously exercised, an Option or Stock Purchase Right will terminate
immediately prior to the consummation of such proposed action.

(c) Merger
or Asset Sale.
In the event of a merger of the Company with or into another corporation, or
the sale of substantially all of the assets of the Company, each outstanding
Option and Stock Purchase Right shall be assumed or an equivalent option or
right substituted by the successor corporation or a Parent or Subsidiary of the
successor corporation. In the event that the successor corporation refuses to
assume or substitute for the Option or Stock Purchase Right, the Optionee shall fully vest in and have the right to exercise
the Option or Stock Purchase Right as to all of the Optioned Stock, including
Shares as to which it would not otherwise be vested or exercisable. If an
Option or Stock Purchase Right becomes fully vested and exercisable in lieu of
assumption or substitution in the event of a merger or sale of assets, the
Administrator shall notify the Optionee in writing or
electronically that the Option or Stock Purchase Right shall be fully vested
and exercisable for a period of fifteen (15) days from the date of such
notice, and the Option or Stock Purchase Right shall terminate upon the
expiration of such period. For the purposes of this paragraph, the Option or
Stock Purchase Right shall be considered assumed if, following the merger or
sale of assets, the option or right confers the right to purchase or receive,
for each Share of Optioned Stock subject to the Option or Stock Purchase Right
immediately prior to the merger or sale of assets, the consideration (whether
stock, cash, or other securities or property) received in the merger or sale of
assets by holders of Common Stock for each Share held on the effective date of
the transaction (and if holders were offered a choice of consideration, the
type of consideration chosen by the holders of a majority of the outstanding
Shares); provided, however, that if such consideration received in the merger
or sale of assets is not solely common stock of the successor corporation or
its Parent, the Administrator may, with the consent of the successor
corporation, provide for the consideration to be received upon the exercise of
the Option or Stock Purchase Right, for each Share of Optioned Stock subject to
the Option or Stock Purchase Right, to be solely common stock of the successor
corporation or its Parent equal in fair market value to the per share
consideration received by holders of Common Stock in the merger or sale of assets.

14. Date
of Grant. The date of grant of an Option or Stock Purchase Right shall be,
for all purposes, the date on which the Administrator makes the determination
granting such Option or Stock Purchase Right, or such other later date as is
determined by the Administrator. Notice of the determination shall be provided
to each Optionee within a reasonable time after the
date of such grant.

15. Amendment
and Termination of the Plan.

(a) Amendment
and Termination. The Board may at any time amend, alter, suspend or
terminate the Plan.

(b) Shareholder
Approval. The Company shall obtain shareholder approval of any Plan
amendment to the extent necessary and desirable to comply with Applicable Laws.

(c) Effect
of Amendment or Termination. No amendment, alteration, suspension or
termination of the Plan shall impair the rights of any Optionee,
unless mutually agreed otherwise between the Optionee
and the Administrator, which agreement must be in writing and signed by the Optionee and the Company. Termination of the Plan shall not
affect the Administrator’s ability to exercise the powers granted to it
hereunder with respect to Options granted under the Plan prior to the date of
such termination.

16. Conditions
Upon Issuance of Shares.

(a) Legal
Compliance. Shares shall not be issued pursuant to the exercise of an
Option or Stock Purchase Right unless the exercise of such Option or Stock
Purchase Right and the issuance and delivery of such Shares shall comply with
Applicable Laws and shall be further subject to the approval of counsel for the
Company with respect to such compliance.

(b) Investment
Representations. As a condition to the exercise of an Option or Stock
Purchase Right, the Company may require the person exercising such Option or
Stock Purchase Right to represent and warrant at the time of any such exercise
that the Shares are being purchased only for investment and without any present
intention to sell or distribute such Shares if, in the opinion of counsel for
the Company, such a representation is required.

17. Inability
to Obtain Authority. The inability of the Company to obtain authority from
any regulatory body having jurisdiction, which authority is deemed by the
Company’s counsel to be necessary to the lawful issuance and

-8-

sale of any Shares hereunder, shall relieve
the Company of any liability in respect of the failure to issue or sell such
Shares as to which such requisite authority shall not have been obtained.

18. Reservation
of Shares. The Company, during the term of this Plan, will at all times reserve and keep available such number of Shares as
shall be sufficient to satisfy the requirements of the Plan.

19. Shareholder
Approval. The Plan shall be subject to approval by the shareholders of the
Company within twelve (12) months after the date the Plan is adopted. Such
shareholder approval shall be obtained in the manner and to the degree required
under Applicable Laws.

-9-

Brocade
Communications Systems, Inc.

Notice
of Grant of Stock Options
and Option Agreement

ID:
77-0409517
1745 Technology DriveSan
Jose,
CA95110

Name:

Option
Number:

Plan:

1999

Address:

ID:

Effective
[DATE], you have been granted a(n) Non-Qualified Stock Option to buy [SHARES]
shares of Brocade Communications Systems, Inc. (the Company) stock at $[PRICE]
per share.

The total option
price of the shares granted is $[PRICE].

Shares in each
period will become fully vested on the date shown.

Shares

Vest Type

Full Vest

Expiration

By your
signature and the Company’s signature below, you and the Company agree that
these options are granted under and governed by the terms and conditions of the
Company’s Stock Option Plan as amended and the Option Agreement, all of which
are attached and made a part of this document.

Unless otherwise
defined herein, the terms defined in this Option Agreement shall have the same defined
meanings as in the Plan.

NOTICE OF
STOCK OPTION GRANT

You have been
granted a option to purchase Common Stock of the
Company, subject to the terms and conditions of the Plan and this Option
Agreement, as indicated on this “Notice of Grant of Stock Options and Option
Agreement.”

Vesting
Schedule: Subject to the
Optionee continuing to be a Service Provider on such
dates, this Option shall vest and become exercisable in accordance with the
provisions indicated on the “Notice of Grant of Stock Options and Option
Agreement,” subject to Optionee remaining a Service
Provider on such vesting dates.

Termination
Period:

This Option may
be exercised for three months after Optionee ceases
to be a Service Provider. Upon the death or Disability of the Optionee, this Option may be exercised for one year after Optionee ceases to be a Service Provider. In no event shall
this Option be exercised later than the Term/Expiration Date as provided above.

I. AGREEMENT

A. Grant
of Option.

The Plan
Administrator of the Company hereby grants to the Optionee
named in the Notice of Grant attached as Part I of this Agreement (the “Optionee”) an option (the “Option”) to purchase the number
of Shares, as set forth in the Notice of Grant, at the exercise price per share
set forth in the Notice of Grant (the “Exercise Price”), subject to the terms
and conditions of the Plan, which is incorporated herein by reference. Subject
to Section 15(c) of the Plan, in the event of a conflict between the terms and
conditions of the Plan and the terms and conditions of this Option Agreement,
the terms and conditions of the Plan shall prevail.

If designated in
the Notice of Grant as an Incentive Stock Option (“ISO”), this Option is
intended to qualify as an Incentive Stock Option under Section 422 of the
Code. However, if this Option is intended to be an Incentive Stock Option, to
the extent that it exceeds the $100,000 rule of Code Section 422(d) it shall be
treated as a Nonstatutory Stock Option (“NSO”).

B. Exercise
of Option.

(a) Right to Exercise. This Option is exercisable
during its term in accordance with the Vesting Schedule set out in the Notice
of Grant and the applicable provisions of the Plan and this Option Agreement.

(b)
Method of Exercise. This Option is exercisable by delivery of an
exercise notice, in the form attached as Exhibit A (the “Exercise
Notice”), which shall state the election to exercise the Option, the number of
Shares in respect of which the Option is being exercised (the “Exercised
Shares”), and such other representations and agreements as may be required by
the Company pursuant to the provisions of the Plan. The Exercise Notice shall
be completed by the Optionee and delivered to
Elizabeth Moore, Stock Administrator, of the Company. The Exercise Notice shall
be accompanied by payment of the aggregate Exercise Price as to all Exercised
Shares. This Option shall be deemed to be exercised upon receipt by the Company
of such fully executed Exercise Notice accompanied by such aggregate Exercise
Price.

No
Shares shall be issued pursuant to the exercise of this Option unless such
issuance and exercise complies with Applicable Laws. Assuming such compliance,
for income tax purposes the Exercised Shares shall be considered transferred to
the Optionee on the date the Option is exercised with
respect to such Exercised Shares.

C. Method
of Payment.

Payment of the
aggregate Exercise Price shall be by any of the following, or a combination
thereof, at the election of the Optionee:

1.
cash; or

2.
check; or

3.
consideration received by the Company under a cashless
exercise program implemented by the Company in connection with the Plan; or

4.
surrender of other Shares which (i) in the case
of Shares acquired upon exercise of an option, have been owned by the Optionee for more than six (6) months on the date of
surrender, and (ii) have a Fair Market Value on the date of
surrender equal to the aggregate Exercise Price of the Exercised Shares.

D. Non-Transferability
of Option.

This
Option may not be transferred in any manner otherwise than by will or by the
laws of descent or distribution and may be exercised during the lifetime of Optionee only by the Optionee. The
terms of the Plan and this Option Agreement shall be binding upon the
executors, administrators, heirs, successors and assigns of the Optionee.

E. Term
of Option.

This
Option may be exercised only within the term set out in the Notice of Grant,
and may be exercised during such term only in accordance with the Plan and the
terms of this Option Agreement.

F. Tax
Consequences.

Some
of the federal tax consequences relating to this Option, as of the date of this
Option, are set forth below. THIS SUMMARY IS NECESSARILY INCOMPLETE, AND THE
TAX LAWS AND REGULATIONS ARE SUBJECT TO CHANGE. THE OPTIONEE SHOULD CONSULT A
TAX ADVISER BEFORE EXERCISING THIS OPTION OR DISPOSING OF THE SHARES.

G. Exercising
the Option.

1.
Nonstatutory Stock Option. The Optionee may incur regular federal income tax liability
upon exercise of a NSO. The Optionee will be treated
as having received compensation income (taxable at ordinary income tax rates)
equal to the excess, if any, of the Fair Market Value of the Exercised Shares
on the date of exercise over their aggregate Exercise Price. If the Optionee is an Employee or a former Employee, the Company
will be required to withhold from his or her compensation or collect from Optionee and pay to the applicable taxing authorities an
amount in cash equal to a percentage of this compensation income at the time of
exercise, and may refuse to honor the exercise and refuse to deliver Shares if
such withholding amounts are not delivered at the time of exercise.

2.
Incentive Stock Option. If this Option qualifies as an ISO, the Optionee will have no regular federal income tax liability
upon its exercise, although the excess, if any, of the Fair Market Value of the
Exercised Shares on the date of exercise over their aggregate Exercise Price
will be treated as an adjustment to alternative minimum taxable income for
federal tax purposes and may subject the Optionee to
alternative minimum tax in the year of exercise. In the event that the Optionee ceases to be an Employee but remains a Service
Provider, any Incentive Stock Option of the Optionee
that remains unexercised shall cease to qualify as an Incentive Stock Option
and will be treated for tax purposes as a Nonstatutory
Stock Option on the date three (3) months and one (1) day following such
change of status.

3.
Disposition of Shares.

(a) NSO.
If the Optionee holds NSO Shares for at least one
year, any gain realized on disposition of the Shares will be treated as long-term
capital gain for federal income tax purposes.

(b) ISO.
If the Optionee holds ISO Shares for at least one
year after exercise and two years after the grant date, any gain realized on
disposition of the Shares will be treated as long-term capital gain for federal
income tax purposes. If the Optionee disposes of ISO
Shares within one year after exercise or two years after the grant date, any
gain realized on such disposition will be treated as compensation income
(taxable at ordinary income rates) to the extent of the excess, if any, of the
lesser of (A) the difference between the Fair Market Value of the Shares
acquired on the date of exercise and the aggregate Exercise Price, or
(B) the difference between the sale price of such Shares and the aggregate
Exercise Price. Any additional gain will be taxed as capital gain, short-term
or long-term depending on the period that the ISO Shares were held.

(c) Notice
of Disqualifying Disposition of ISO Shares. If the Optionee
sells or otherwise disposes of any of the Shares acquired pursuant to an ISO on
or before the later of (i) two years after the grant
date, or (ii) one year after the exercise date, the Optionee
shall immediately notify the Company in writing of such disposition. The Optionee agrees that he or she may be subject to income tax
withholding by the Company on the compensation income recognized from such
early disposition of ISO Shares by payment in cash or out of the current
earnings paid to the Optionee.

H. Entire
Agreement; Governing Law.

The
Plan is incorporated herein by reference. The Plan and this Option Agreement
constitute the entire agreement of the parties with respect to the subject
matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Optionee with respect
to the subject matter hereof, and may not be modified adversely to the Optionee’s interest except by means of a writing signed by
the Company and Optionee. This agreement is governed
by the internal substantive laws, but not the choice of law rules, of Delaware.

I. NO
GUARANTEE OF CONTINUED SERVICE.

OPTIONEE
ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO THE VESTING
SCHEDULE HEREOF IS EARNED ONLY BY CONTINUING AS A SERVICE PROVIDER AT THE WILL
OF THE COMPANY (AND NOT THROUGH THE ACT OF BEING HIRED, BEING GRANTED AN OPTION
OR PURCHASING SHARES HEREUNDER). OPTIONEE FURTHER ACKNOWLEDGES AND AGREES THAT
THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING
SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF
CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY
PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH OPTIONEE’S RIGHT OR THE
COMPANY’S RIGHT TO TERMINATE OPTIONEE’S RELATIONSHIP AS A SERVICE PROVIDER AT
ANY TIME, WITH OR WITHOUT CAUSE.

By your
signature and the signature of the Company’s representative, you and the
Company agree that this Option is granted under and governed by the terms and
conditions of the Plan and this Option Agreement. Optionee
has reviewed the Plan and this Option Agreement in their entirety, has had an
opportunity to obtain the advice of counsel prior to executing this Option
Agreement and fully understands all provisions of the Plan and Option
Agreement. Optionee hereby agrees to accept as
binding, conclusive and final all decisions or interpretations of the
Administrator upon any questions relating to the Plan and Option Agreement. Optionee further agrees to notify the Company upon any
change in the residence address indicated on page one.

CONSENT OF SPOUSE

The
undersigned spouse of Optionee has read and hereby
approves the terms and conditions of the Plan and this Option Agreement. In
consideration of the Company’s granting his or her spouse the right to purchase
Shares as set forth in the Plan and this Option Agreement, the undersigned
hereby agrees to be irrevocably bound by the terms and conditions of the Plan
and this Option Agreement and further agrees that any community property
interest shall be similarly bound. The undersigned hereby appoints the
undersigned’s spouse as attorney-in-fact for the undersigned with respect to
any amendment or exercise of rights under the Plan or this Option Agreement.

1. Exercise
of Option. Effective as of today, ,
, the
undersigned (“Purchaser”) hereby elects to purchase shares
(the “Shares”) of the Common Stock of Brocade Communications Systems, Inc. (the
“Company”) under and pursuant to the Brocade Communications Systems, Inc. 1999
Stock Plan (the “Plan”) and the Stock Option Agreement dated,
(the “Option Agreement”). The purchase price for the Shares shall be $,
as required by the Option Agreement.

2. Delivery
of Payment. Purchaser herewith delivers to the Company the full purchase
price for the Shares.

3. Representations
of Purchaser. Purchaser acknowledges that Purchaser has received, read and
understood the Plan and the Option Agreement and agrees to abide by and be
bound by their terms and conditions.

4. Rights
as Shareholder. Until the issuance (as evidenced by the appropriate entry
on the books of the Company or of a duly authorized transfer agent of the
Company) of the Shares, no right to vote or receive dividends or any other
rights as a shareholder shall exist with respect to the Optioned Stock,
notwithstanding the exercise of the Option. The Shares so acquired shall be
issued to the Optionee as soon as practicable after
exercise of the Option. No adjustment will be made for a dividend or other
right for which the record date is prior to the date of issuance, except as
provided in [Section 13] of the Plan.

5. Tax
Consultation. Purchaser understands that Purchaser may suffer adverse tax
consequences as a result of Purchaser’s purchase or disposition of the Shares.
Purchaser represents that Purchaser has consulted with any tax consultants
Purchaser deems advisable in connection with the purchase or disposition of the
Shares and that Purchaser is not relying on the Company for any tax advice.

6. Entire
Agreement; Governing Law. The Plan and Option Agreement are incorporated
herein by reference. This Agreement, the Plan and the Option Agreement
constitute the entire agreement of the parties with respect to the subject
matter hereof and supersede in their entirety all prior undertakings and
agreements of the Company and Purchaser with respect to the subject matter
hereof, and may not be modified adversely to the Purchaser’s interest except by
means of a writing signed by the Company and Purchaser. This agreement is governed
by the internal substantive laws, but not the choice of law rules, of Delaware.

You
have been granted the right to purchase Common Stock of Brocade Communications
Systems, Inc. (the “Company”), subject to your ongoing status as a Service
Provider (as described in the Plan) and the forfeiture provision and other
terms and conditions set forth in the attached Restricted Stock Purchase
Agreement, as follows:

Grant Number

Date of Grant

Purchase Price
Per Share

$0.001 per
share (par value)

Fair Market
Value on Grant Date

$

Total Number
of Shares Subject

to
This Stock Purchase Right

Expiration
Date:

YOU
MUST EXERCISE THIS STOCK PURCHASE RIGHT BEFORE THE EXPIRATION DATE OR IT WILL
TERMINATE AND YOU WILL HAVE NO FURTHER RIGHT TO PURCHASE THE SHARES. By your
signature and the signature of the Company’s representative below, you and the
Company agree that this Stock Purchase Right is granted under and governed by
the terms and conditions of the 1999 Stock Plan and the Restricted Stock
Purchase Agreement, attached hereto as Exhibit A-1, both of which are made
a part of this document. You further agree to execute the attached Restricted
Stock Purchase Agreement as a condition to purchasing any shares under this
Stock Purchase Right. Unless otherwise defined herein, the terms defined in the
Plan shall have the same defined meanings in this Notice of Grant.

Purchaser:

Brocade Communications Systems, Inc.

Signature

Signature

Print Name

Print Name

Title

EXHIBIT A-1

1999 STOCK PLAN

RESTRICTED STOCK PURCHASE AGREEMENT

Unless
otherwise defined herein, the defined terms in this Restricted Stock Purchase
Agreement shall have the same meanings as defined in the 1999 Stock Plan (the
“Plan”).

WHEREAS
the Purchaser named in the Notice of Grant (the “Purchaser”) is a Service
Provider, and the Purchaser’s continued participation is considered by the
Company to be important for the Company’s continued growth; and

WHEREAS
in order to give the Purchaser an opportunity to acquire an equity interest in
the Company as an incentive for the Purchaser to participate in the affairs of
the Company, the Administrator has granted to the Purchaser a Stock Purchase
Right subject to the terms and conditions of the Plan and the Notice of Grant,
which are incorporated herein by reference, and pursuant to this Restricted
Stock Purchase Agreement (the “Agreement”).

NOW
THEREFORE, the parties agree as follows:

1. Sale of Stock.
The Company hereby agrees to sell to the Purchaser and the Purchaser hereby
agrees to purchase shares of the Company’s Common Stock (the “Shares”), at the per Share purchase price and as otherwise described in
the Notice of Grant.

2. Payment
of Purchase Price. The purchase price for the Shares may be paid by
delivery to the Company at the time of execution of this Agreement of cash, a
check, or some combination thereof.

3. Forfeiture.
Except as provided and subject to the provisions of Section 13 of the
Plan, and only in the event the Purchaser ceases to be a Service Provider for
any or no reason (including death or disability) before the Restriction Period
lapses with respect to all of the Shares (see Section 4), all of the
Shares which constitute Unreleased Shares shall be automatically forfeited by
the Purchaser (without any further consideration or notice from the Company),
effective upon the date of such termination (as determined by the Company).
Upon forfeiture of the Unreleased Shares, the Company shall become the legal
and beneficial owner of the Shares which constitute Unreleased Shares and all
rights and interests therein or relating thereto, and the Company shall have
the right to retain and transfer to its own name the number of Unreleased
Shares.

4. Vesting
of Shares and Expiration of Restriction Period.

(a) Except
as provided by and subject to the provisions of Section 13 of the Plan,
upon the [___]* anniversary of the Date of Grant, the Restriction Period shall
lapse with respect to one hundred percent (100%) of the Shares. On such
anniversary or such earlier period under Section

* On a
case-by-case basis, the Compensation Committee reserves the right to determine
the term and/or amount.

13 of the Plan,
all of the Shares shall be vested as to the Purchaser and no longer subject to
forfeiture to the Company.

(b) Any
of the Shares subject to the Restriction Period that have not yet vested are
referred to herein as “Unreleased Shares.”

(c) The
Shares with respect to which the Restriction Period has expired shall be
delivered to the Purchaser upon the expiration of the Restriction Period. (See Section 7.)

5. [Intentionally
Omitted].

6. Restriction
on Transfer. Except for the escrow described in Section 7 or the
transfer of the Shares to the Company contemplated by this Agreement, none of
the Shares or any beneficial interest therein shall be transferred, encumbered
or otherwise disposed of in any way until the Restriction Period expires with
respect to such Shares in accordance with the provisions of this Agreement,
other than by will or the laws of descent and distribution.

7. Escrow
of Shares.

(a) To
ensure the availability for delivery of the Unreleased Shares upon forfeiture,
the Purchaser shall, upon execution of this Agreement, deliver and deposit with
an escrow holder designated by the Company (the “Escrow Holder”) the share
certificates representing the Unreleased Shares, together with the stock
assignment duly endorsed in blank, attached hereto as Exhibit A-2. The
Unreleased Shares and stock assignment shall be held by the Escrow Holder,
pursuant to the Joint Escrow Instructions of the Company and Purchaser attached
hereto as Exhibit A-3, until such time as the Company’s Restriction Periodexpires. As a further condition to the Company’s
obligations under this Agreement, the Company may require the spouse of
Purchaser, if any, to execute and deliver to the Company the Consent of Spouse
attached hereto as Exhibit A-4.

(b) The
Escrow Holder shall not be liable for any act it may do or omit to do with
respect to holding the Unreleased Shares in escrow while acting in good faith
and in the exercise of its judgment.

(c) Upon
forfeiture of the Unreleased Shares pursuant to this Agreement, the Escrow
Holder, upon receipt of written notice of such exercise from the proposed
transferee, shall take all steps necessary to accomplish such transfer.

(d) Upon
forfeiture of the Unreleased Shares, the Escrow Holder shall promptly cause the
certificate representing the Shares which constitute the Unreleased Shares to
be delivered to the Company. If the Restriction Period lapses with respect to a
portion or all of the Shares, upon request the Escrow Holder shall promptly
cause a new certificate to be issued for the Shares no longer subject to
forfeiture and delivered to the Purchaser free of any legend or restriction,
subject to Applicable Laws.

-2-

(e) Subject
to the terms hereof, the Purchaser shall have all the rights of a shareholder with
respect to the Shares while they are held in escrow, including without
limitation, the right to vote the Shares and to receive any cash dividends
declared thereon. If, from time to time during the term of the Restriction
Period, there is any (i) stock dividend, stock
split or other change in the Shares, or (ii) merger or sale of all or
substantially all of the assets or other acquisition of the Company, any and
all new, substituted or additional securities to which the Purchaser is
entitled by reason of the Purchaser’s ownership of the Shares shall be
immediately subject to this escrow, deposited with the Escrow Holder and
included thereafter as “Shares” for purposes of this Agreement and subject to
the Restriction Period (to the extent the Shares would have otherwise been
subject to the Restriction Period).

8. Legends.
The share certificate evidencing the Shares, if any, issued hereunder shall be
endorsed with the following legend (in addition to any legend required under
applicable federal, state or other securities laws):

THE
SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS UPON
TRANSFER AND RIGHTS OF REPURCHASE AS SET FORTH IN AN AGREEMENT BETWEEN THE
COMPANY AND THE SHAREHOLDER, A COPY OF WHICH IS ON FILE WITH THE COMPANY.

9. Adjustment
for Stock Split. All references to the number of Shares and the purchase
price of the Shares in this Agreement shall be appropriately adjusted to
reflect any stock split, stock dividend or other change in the Shares that may be
made by the Company after the date of this Agreement.

10. Tax
Consequences. The Purchaser has reviewed with the Purchaser’s own tax
advisors the federal, state, local and foreign tax consequences of this
investment and the transactions contemplated by this Agreement. The Purchaser
is relying solely on such advisors and not on any statements or representations
of the Company or any of its agents. The Purchaser understands that the
Purchaser (and not the Company) shall be responsible for the Purchaser’s own
tax liability that may arise as a result of the transactions contemplated by
this Agreement. The Purchaser understands that Section 83 of the Internal
Revenue Code of 1986, as amended (the “Code”), taxes as ordinary income the
difference between the purchase price for the Shares and the Fair Market Value
of the Shares as of the date any restrictions on the Shares lapse. In this
context, “restriction” includes the forfeiture provision pursuant to
Section 3 of the Agreement. The Purchaser understands that the Purchaser
may elect to be taxed at the time the Shares are purchased rather than when and
as the Restriction Period lapses by filing an election under Section 83(b) of
the Code with the IRS within 30 days from the date of purchase. The form
for making this election is attached as Exhibit A-5 hereto.

THE PURCHASER ACKNOWLEDGES THAT IT IS THE PURCHASER’S SOLE
RESPONSIBILITY AND NOT THE COMPANY’S TO FILE TIMELY THE ELECTION UNDER SECTION
83(b), EVEN IF THE PURCHASER ASKS THE COMPANY OR ITS REPRESENTATIVES TO MAKE
THIS FILING ON THE PURCHASER’S BEHALF.

-3-

11. General
Provisions.

(a) This
Agreement shall be governed by the internal substantive laws, but not the
choice of law rules of California.
This Agreement, subject to the terms and conditions of the Plan and the Notice
of Grant, represents the entire agreement between the parties with respect to
the purchase of the Shares by the Purchaser. Subject to Section 15(c) of the
Plan, in the event of a conflict between the terms and conditions of the Plan
and the terms and conditions of this Agreement, the terms and conditions of
this Agreement shall prevail. Unless otherwise defined herein, the terms
defined in the Plan shall have the same defined meanings in this Agreement.

(b) Any
notice, demand or request required or permitted to be given by either the
Company or the Purchaser pursuant to the terms of this Agreement shall be in
writing and shall be deemed given when delivered personally or deposited in the
U.S. mail, First Class with postage prepaid, and addressed to the parties at
the addresses of the parties set forth at the end of this Agreement or such
other address as a party may request by notifying the other in writing.

Any
notice to the Escrow Holder shall be sent to the Company’s address with a copy
to the other party hereto.

(c) The
rights of the Company under this Agreement shall be transferable to any one or
more persons or entities, and all covenants, obligations and agreements hereunder
shall inure to the benefit of, and be enforceable by the Company’s successors
and assigns. The rights and obligations of the Purchaser under this Agreement
may only be assigned with the prior written consent of the Company.

(d) Either
party’s failure to enforce any provision of this Agreement shall not in any way
be construed as a waiver of any such provision, nor prevent that party from
thereafter enforcing any other provision of this Agreement. The rights granted
both parties hereunder are cumulative and shall not constitute a waiver of
either party’s right to assert any other legal remedy available to it.

(e) The
Purchaser agrees upon request to execute any further documents or instruments
necessary or desirable to carry out the purposes or intent of this Agreement.

(f) PURCHASER
ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO SECTION 4 HEREOF
IS EARNED ONLY BY CONTINUING SERVICE AS A SERVICE PROVIDER AT THE WILL OF THE
COMPANY (OR THE PARTENT OR SUBSIDIARY EMPLOYING OR RETAINING PURCHASER) AND NOT
THROUGH THE ACT OF BEING HIRED OR PURCHASING SHARES HEREUNDER AND OTHER THAN AS
SET FORTH IN SECTION 13 OF THE PLAN. PURCHASER FURTHER ACKNOWLEDGES AND AGREES
THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED HEREUNDER AND THE VESTING
SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN EXPRESS OR IMPLIED PROMISE OF
CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR THE VESTING PERIOD, FOR ANY
PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH PURCHASER’S RIGHT OR THE RIGHT
OF THE COMPANY (OR THE PARENT OR SUBSIDIARY EMPLOYING OR RETAINING PURCHASER)
TO TERMINATE PURCHASER’S RELATIONSHIP AS A SERVICE PROVIDER AT ANY TIME, WITH
OR WITHOUT CAUSE.

-4-

By
Purchaser’s signature below, Purchaser represents that he or she is familiar
with the terms and provisions of the Plan, and hereby accepts this Agreement
subject to all of the terms and provisions thereof. Purchaser has reviewed the
Plan and this Agreement in their entirety, has had an opportunity to obtain the
advice of counsel prior to executing this Agreement and fully understands all
provisions of this Agreement. Purchaser agrees to accept as binding, conclusive
and final all decisions or interpretations of the Administrator upon any
questions arising under the Plan or this Agreement. Purchaser further agrees to
notify the Company upon any change in the residence indicated in the Notice of
Grant.

DATED:

PURCHASER:

BROCADE
COMMUNICATIONS SYSTEMS, INC.

Signature

Signature

Print Name

Print Name

Title

-5-

EXHIBIT A-1

1999 STOCK PLAN

RESTRICTED STOCK PURCHASE AGREEMENT

Unless
otherwise defined herein, the defined terms in this Restricted Stock Purchase
Agreement shall have the same meanings as defined in the 1999 Stock Plan (the
“Plan”).

WHEREAS
the Purchaser named in the Notice of Grant (the “Purchaser”) is a Service
Provider, and the Purchaser’s continued participation is considered by the
Company to be important for the Company’s continued growth; and

WHEREAS
in order to give the Purchaser an opportunity to acquire an equity interest in
the Company as an incentive for the Purchaser to participate in the affairs of
the Company, the Administrator has granted to the Purchaser a Stock Purchase
Right subject to the terms and conditions of the Plan and the Notice of Grant,
which are incorporated herein by reference, and pursuant to this Restricted
Stock Purchase Agreement (the “Agreement”).

NOW
THEREFORE, the parties agree as follows:

1. Sale of Stock.
The Company hereby agrees to sell to the Purchaser and the Purchaser hereby
agrees to purchase shares of the Company’s Common Stock (the “Shares”), at the per Share purchase price and as otherwise described in
the Notice of Grant.

2. Payment
of Purchase Price. The purchase price for the Shares may be paid by
delivery to the Company at the time of execution of this Agreement of cash, a
check, or some combination thereof.

3. Forfeiture.
Except as provided and subject to the provisions of Section 4(d) of this
Agreement and Section 13 of the Plan, and only in the event the Purchaser
ceases to be a Service Provider for any or no reason (including death or
disability) before the Restriction Period lapses with respect to all of the
Shares (see Section 4), all of the Shares which constitute Unreleased
Shares shall be automatically forfeited by the Purchaser (without any further
consideration or notice from the Company), effective upon the date of such
termination (as determined by the Company). Upon forfeiture of the Unreleased
Shares, the Company shall become the legal and beneficial owner of the Shares
which constitute Unreleased Shares and all rights and interests therein or
relating thereto, and the Company shall have the right to retain and transfer
to its own name the number of Unreleased Shares.

4. Vesting
of Shares and Expiration of Restriction Period.

(a) Except
as provided by and subject to the provisions of Section 4(d) of this Agreement
and Section 13 of the Plan, upon the [___]* anniversary of the Date of
Grant, the Restriction Period shall lapse with respect to one hundred percent
(100%) of the Shares. On such

* On a
case-by-case basis, the Compensation Committee reserves the right to determine
the term and/or amount.

anniversary or such earlier period under Section 4(d) below and Section 13
of the Plan, all of the Shares shall be vested as to the Purchaser and no
longer subject to forfeiture to the Company.

(b) Any
of the Shares subject to the Restriction Period that have not yet vested are
referred to herein as “Unreleased Shares.”

(c) The
Shares with respect to which the Restriction Period has expired shall be
delivered to the Purchaser upon the expiration of the Restriction Period. (See Section 7.)

(d) If
Purchaser’s employment with the Company (or any Parent or Subsidiary of the
Company) is terminated by the Company (or the Parent or Subsidiary of the
Company) without Cause or by Purchaser for Good Reason in Connection with a
Change of Control, then the Restriction Period shall lapse with respect to
[___]* of the Shares as of the date of Purchaser’s termination of employment
with the Company (or any Parent or Subsidiary of the Company).

5. Definitions.

(a)
Cause. For purposes of this Agreement, “Cause” means (i) Purchaser’s willful and continued failure to
perform the duties and responsibilities of his position that is not corrected
within a thirty (30) day correction period that begins upon delivery to
Purchaser of a written demand for performance from the Board that describes the
basis for the Board’s belief that Purchaser has not substantially performed his
duties; (ii) any act of personal dishonesty taken by Purchaser in
connection with his or her responsibilities as an employee of the Company with
the intention or reasonable expectation that such may result in substantial
personal enrichment of Purchaser; (iii) Purchaser’s conviction of, or plea
of nolocontendreto, a felony that the Board reasonably believes has had or will have a
material detrimental effect on the Company’s reputation or business, or
(iv) Purchaser materially breaching Purchaser’s Confidential Information
Agreement, which breach is (if capable of cure) not cured within thirty
(30) days after the Company delivers written notice to Purchaser of the
breach.

(b)
Change of Control. “Change of Control” shall mean the occurrence of any
of the following events:

(i) the consummation by the Company of a merger or
consolidation of the Company with any other corporation, other than a merger or
consolidation which would result in the voting securities of the Company
outstanding immediately prior thereto continuing to represent (either by
remaining outstanding or by being converted into voting securities of the
surviving entity) more than fifty percent (50%) of the total voting power
represented by the voting securities of the Company or such surviving entity outstanding
immediately after such merger or consolidation;

(ii)
the consummation of the sale or disposition by the
Company of all or substantially all of the Company’s assets;

*

On a
case-by-case basis, the Compensation Committee reserves the right to
determine the term and/or amounts.

-2-

(iii)
any “person” (as such term is used in Sections 13(d) and 14(d) of the
Securities Exchange Act of 1934, as amended) becoming the “beneficial owner”
(as defined in Rule 13d-3 under said Act), directly or indirectly, of
securities of the Company representing 50% or more of the total voting power
represented by the Company’s then outstanding voting securities; or

(iv)
a change in the composition of the Board, as a result
of which fewer than a majority of the directors are Incumbent Directors.
“Incumbent Directors” shall mean directors who either (A) are directors of
the Company as of the date hereof, or (B) are elected, or nominated for
election, to the Board with the affirmative votes of at least a majority of
those directors whose election or nomination was not in connection with any
transactions described in subsections (i), (ii), or
(iii) or in connection with an actual or threatened proxy contest relating
to the election of directors of the Company.

(c)
Disability. For purposes of this Agreement, Disability will have the
same defined meaning as in the Company’s long-term disability plan.

(d)
Good Reason. For purposes of this Agreement, “Good Reason” means the
occurrence of any of the following, without Purchaser’s consent: (i) a material reduction of Purchaser’s duties, title,
authority or responsibilities in effect immediately prior to a Change of
Control; (ii) a reduction in Purchaser’s base salary or target annual cash
incentive compensation; (iii) the failure of the Company to obtain the
assumption of the Agreement by the successor, or (iv) the Company
requiring Purchaser to relocate his or her principal place of business or the
Company relocating its headquarters, in either case to a facility or location
outside of a thirty-five (35) mile radius from Purchaser’s current principal
place of employment; provided, however, that Purchaser only will have Good
Reason if the event or circumstances constituting Good Reason specified in any
of the preceding clauses is not cured within thirty (30) days after
Purchaser gives written notice to the Board. Purchaser’s actions approving any
of the foregoing changes (that otherwise may be considered Good Reason) will be
considered consent for the purposes of this Good Reason definition.

(e)
In Connection with a Change of Control. For purposes of this Agreement,
a termination of Purchaser’s employment with the Company is “in Connection with
a Change of Control” if Purchaser’s employment is terminated within twelve
(12) months following a Change of Control.

6. Restriction
on Transfer. Except for the escrow described in Section 7 or the
transfer of the Shares to the Company contemplated by this Agreement, none of
the Shares or any beneficial interest therein shall be transferred, encumbered
or otherwise disposed of in any way until the Restriction Period expires with
respect to such Shares in accordance with the provisions of this Agreement,
other than by will or the laws of descent and distribution.

7. Escrow
of Shares.

-3-

(a) To
ensure the availability for delivery of the Unreleased Shares upon forfeiture,
the Purchaser shall, upon execution of this Agreement, deliver and deposit with
an escrow holder designated by the Company (the “Escrow Holder”) the share
certificates representing the Unreleased Shares, together with the stock
assignment duly endorsed in blank, attached hereto as Exhibit A-2. The
Unreleased Shares and stock assignment shall be held by the Escrow Holder,
pursuant to the Joint Escrow Instructions of the Company and Purchaser attached
hereto as Exhibit A-3, until such time as the Company’s Restriction Periodexpires. As a further condition to the Company’s
obligations under this Agreement, the Company may require the spouse of
Purchaser, if any, to execute and deliver to the Company the Consent of Spouse
attached hereto as Exhibit A-4.

(b) The
Escrow Holder shall not be liable for any act it may do or omit to do with
respect to holding the Unreleased Shares in escrow while acting in good faith
and in the exercise of its judgment.

(c) Upon
forfeiture of the Unreleased Shares pursuant to this Agreement, the Escrow
Holder, upon receipt of written notice of such exercise from the proposed
transferee, shall take all steps necessary to accomplish such transfer.

(d) Upon
forfeiture of the Unreleased Shares, the Escrow Holder shall promptly cause the
certificate representing the Shares which constitute the Unreleased Shares to
be delivered to the Company. If the Restriction Period lapses with respect to a
portion or all of the Shares, upon request the Escrow Holder shall promptly
cause a new certificate to be issued for the Shares no longer subject to
forfeiture and delivered to the Purchaser free of any legend or restriction,
subject to Applicable Laws.

(e) Subject
to the terms hereof, the Purchaser shall have all the rights of a shareholder
with respect to the Shares while they are held in escrow, including without
limitation, the right to vote the Shares and to receive any cash dividends
declared thereon. If, from time to time during the term of the Restriction
Period, there is any (i) stock dividend, stock
split or other change in the Shares, or (ii) merger or sale of all or
substantially all of the assets or other acquisition of the Company, any and
all new, substituted or additional securities to which the Purchaser is
entitled by reason of the Purchaser’s ownership of the Shares shall be
immediately subject to this escrow, deposited with the Escrow Holder and
included thereafter as “Shares” for purposes of this Agreement and subject to
the Restriction Period (to the extent the Shares would have otherwise been
subject to the Restriction Period).

8. Legends.
The share certificate evidencing the Shares, if any, issued hereunder shall be
endorsed with the following legend (in addition to any legend required under
applicable federal, state or other securities laws):

THE
SHARES REPRESENTED BY THIS CERTIFICATE ARE SUBJECT TO CERTAIN RESTRICTIONS UPON
TRANSFER AND RIGHTS OF REPURCHASE AS SET FORTH IN AN AGREEMENT BETWEEN THE
COMPANY AND THE SHAREHOLDER, A COPY OF WHICH IS ON FILE WITH THE COMPANY.

-4-

9. Adjustment
for Stock Split. All references to the number of Shares and the purchase
price of the Shares in this Agreement shall be appropriately adjusted to
reflect any stock split, stock dividend or other change in the Shares that may
be made by the Company after the date of this Agreement.

10. Tax
Consequences. The Purchaser has reviewed with the Purchaser’s own tax
advisors the federal, state, local and foreign tax consequences of this
investment and the transactions contemplated by this Agreement. The Purchaser
is relying solely on such advisors and not on any statements or representations
of the Company or any of its agents. The Purchaser understands that the
Purchaser (and not the Company) shall be responsible for the Purchaser’s own
tax liability that may arise as a result of the transactions contemplated by
this Agreement. The Purchaser understands that Section 83 of the Internal
Revenue Code of 1986, as amended (the “Code”), taxes as ordinary income the
difference between the purchase price for the Shares and the Fair Market Value
of the Shares as of the date any restrictions on the Shares lapse. In this
context, “restriction” includes the forfeiture provision pursuant to
Section 3 of the Agreement. The Purchaser understands that the Purchaser
may elect to be taxed at the time the Shares are purchased rather than when and
as the Restriction Period lapses by filing an election under Section 83(b) of
the Code with the IRS within 30 days from the date of purchase. The form
for making this election is attached as Exhibit A-5 hereto.

THE PURCHASER ACKNOWLEDGES THAT IT IS THE PURCHASER’S SOLE
RESPONSIBILITY AND NOT THE COMPANY’S TO FILE TIMELY THE ELECTION UNDER SECTION
83(b), EVEN IF THE PURCHASER ASKS THE COMPANY OR ITS REPRESENTATIVES TO MAKE
THIS FILING ON THE PURCHASER’S BEHALF.

11. General
Provisions.

(a) This
Agreement shall be governed by the internal substantive laws, but not the
choice of law rules of California.
This Agreement, subject to the terms and conditions of the Plan and the Notice
of Grant, represents the entire agreement between the parties with respect to
the purchase of the Shares by the Purchaser. Subject to Section 15(c) of the
Plan, in the event of a conflict between the terms and conditions of the Plan
and the terms and conditions of this Agreement, the terms and conditions of
this Agreement shall prevail. Unless otherwise defined herein, the terms
defined in the Plan shall have the same defined meanings in this Agreement.

(b) Any
notice, demand or request required or permitted to be given by either the
Company or the Purchaser pursuant to the terms of this Agreement shall be in
writing and shall be deemed given when delivered personally or deposited in the
U.S. mail, First Class with postage prepaid, and addressed to the parties at
the addresses of the parties set forth at the end of this Agreement or such
other address as a party may request by notifying the other in writing.

Any
notice to the Escrow Holder shall be sent to the Company’s address with a copy
to the other party hereto.

-5-

(c) The
rights of the Company under this Agreement shall be transferable to any one or
more persons or entities, and all covenants, obligations and agreements
hereunder shall inure to the benefit of, and be enforceable by the Company’s
successors and assigns. The rights and obligations of the Purchaser under this Agreement
may only be assigned with the prior written consent of the Company.

(d) Either
party’s failure to enforce any provision of this Agreement shall not in any way
be construed as a waiver of any such provision, nor prevent that party from thereafter
enforcing any other provision of this Agreement. The rights granted both
parties hereunder are cumulative and shall not constitute a waiver of either
party’s right to assert any other legal remedy available to it.

(e) The
Purchaser agrees upon request to execute any further documents or instruments
necessary or desirable to carry out the purposes or intent of this Agreement.

(f) PURCHASER
ACKNOWLEDGES AND AGREES THAT THE VESTING OF SHARES PURSUANT TO SECTION 4 HEREOF
IS EARNED ONLY BY CONTINUING SERVICE AS A SERVICE PROVIDER AT THE WILL OF THE
COMPANY (OR THE PARTENT OR SUBSIDIARY EMPLOYING OR RETAINING PURCHASER) AND NOT
THROUGH THE ACT OF BEING HIRED OR PURCHASING SHARES HEREUNDER AND OTHER THAN AS
SET FORTH IN SECTION 4(d) HEREOF OR SECTION 13 OF THE PLAN. PURCHASER FURTHER
ACKNOWLEDGES AND AGREES THAT THIS AGREEMENT, THE TRANSACTIONS CONTEMPLATED
HEREUNDER AND THE VESTING SCHEDULE SET FORTH HEREIN DO NOT CONSTITUTE AN
EXPRESS OR IMPLIED PROMISE OF CONTINUED ENGAGEMENT AS A SERVICE PROVIDER FOR
THE VESTING PERIOD, FOR ANY PERIOD, OR AT ALL, AND SHALL NOT INTERFERE WITH
PURCHASER’S RIGHT OR THE RIGHT OF THE COMPANY (OR THE PARENT OR SUBSIDIARY
EMPLOYING OR RETAINING PURCHASER) TO TERMINATE PURCHASER’S RELATIONSHIP AS A
SERVICE PROVIDER AT ANY TIME, WITH OR WITHOUT CAUSE.

-6-

By
Purchaser’s signature below, Purchaser represents that he or she is familiar
with the terms and provisions of the Plan, and hereby accepts this Agreement
subject to all of the terms and provisions thereof. Purchaser has reviewed the
Plan and this Agreement in their entirety, has had an opportunity to obtain the
advice of counsel prior to executing this Agreement and fully understands all
provisions of this Agreement. Purchaser agrees to accept as binding, conclusive
and final all decisions or interpretations of the Administrator upon any
questions arising under the Plan or this Agreement. Purchaser further agrees to
notify the Company upon any change in the residence indicated in the Notice of
Grant.

DATED:

PURCHASER:

BROCADE
COMMUNICATIONS SYSTEMS, INC.

Signature

Signature

Print Name

Print Name

Title

-7-

EXHIBIT A-2

ASSIGNMENT SEPARATE FROM CERTIFICATE

FOR
VALUE RECEIVED I, ,
hereby sell, assign and transfer unto
()
shares of the Common Stock of Brocade Communications Systems, Inc. (the
“Company”) standing in my name of the books of said corporation represented by
Certificate No. herewith and do hereby irrevocably constitute and
appoint
to transfer the said stock on the books of the within named corporation with
full power of substitution in the premises.

This
Stock Assignment may be used only in accordance with the Restricted Stock
Purchase Agreement (the “Agreement”) between the Company and the undersigned
dated , .

Dated: ,

Signature:

INSTRUCTIONS:
Please do not fill in any blanks other than the signature line. The purpose
of this assignment is to facilitate the forfeiture and transfer of any Unreleased
Shares as set forth in the Agreement without requiring additional signatures on
the part of the Purchaser.

EXHIBIT A-3

JOINT ESCROW INSTRUCTIONS

,

[Escrow Agent
Name]

[Escrow Agent Address]

Dear :

As
Escrow Agent for both Brocade Communications Systems, Inc., a Delaware
corporation (the “Company”), and the undersigned purchaser of stock of the
Company (the “Purchaser”), you are hereby authorized and directed to hold the
documents delivered to you pursuant to the terms of that certain Restricted
Stock Purchase Agreement (“Agreement”) between the Company and the undersigned,
in accordance with the following instructions:

1. In
the event of the forfeiture of any Shares as set forth in the Agreement,
Purchaser and the Company hereby irrevocably authorize and direct you to close
the transaction contemplated by such notice in accordance with the terms of
said notice.

2. At
the closing, you are directed (a) to date the stock assignments necessary
for the transfer in question, (b) to fill in the number of shares being
transferred, and (c) to deliver same, together with the certificate
evidencing the shares of stock to be transferred, to the Company or its
assignee, against the simultaneous delivery to you of the purchase price (by
cash, a check, or some combination thereof) for the number of shares of stock
forfeited in accordance with the terms of the Agreement.

3. Purchaser
irrevocably authorizes the Company to deposit with you any certificates
evidencing shares of stock to be held by you hereunder and any additions and
substitutions to said shares as defined in the Agreement. Purchaser does hereby
irrevocably constitute and appoint you as Purchaser’s attorney-in-fact and
agent for the term of this escrow to execute with respect to such securities
all documents necessary or appropriate to make such securities negotiable and
to complete any transaction herein contemplated, including but not limited to
the filing with any applicable state blue sky authority of any required
applications for consent to, or notice of transfer of, the securities. Subject
to the provisions of this paragraph 3, Purchaser shall exercise all rights and
privileges of a shareholder of the Company while the stock is held by you.

4. Upon
written request of the Purchaser, but no more than once per calendar year, to
the extent the Restriction Period has lapsed with respect to any Shares, you
shall deliver to Purchaser a certificate or certificates representing so many
shares of stock as are not then subject to the Restriction Period. Within
90 days after Purchaser ceases to be a Service Provider, you shall deliver
to Purchaser a certificate or certificates representing the aggregate number of
shares held or issued pursuant to the Agreement and not forfeited by Purchaser
pursuant to the terms of this Agreement.

5. If
at the time of termination of this escrow you should have in your possession
any documents, securities, or other property belonging to Purchaser, you shall
deliver all of the same to Purchaser and shall be discharged of all further
obligations hereunder.

6. Your
duties hereunder may be altered, amended, modified or revoked only by a writing
signed by all of the parties hereto.

7. You
shall be obligated only for the performance of such duties as are specifically
set forth herein and may rely and shall be protected in relying or refraining
from acting on any instrument reasonably believed by you to be genuine and to
have been signed or presented by the proper party or parties. You shall not be
personally liable for any act you may do or omit to do hereunder as Escrow
Agent or as attorney-in-fact for Purchaser while acting in good faith, and any
act done or omitted by you pursuant to the advice of your own attorneys shall
be conclusive evidence of such good faith.

8. You
are hereby expressly authorized to disregard any and all warnings given by any
of the parties hereto or by any other person or corporation, excepting only
orders or process of courts of law, and are hereby expressly authorized to
comply with and obey orders, judgments or decrees of any court. In case you
obey or comply with any such order, judgment or decree, you shall not be liable
to any of the parties hereto or to any other person, firm or corporation by
reason of such compliance, notwithstanding any such order, judgment or decree
being subsequently reversed, modified, annulled, set aside, vacated or found to
have been entered without jurisdiction.

9. You
shall not be liable in any respect on account of the identity, authorities or
rights of the parties executing or delivering or purporting to execute or
deliver the Agreement or any documents or papers deposited or called for
hereunder.

10. You
shall not be liable for the outlawing of any rights under the statute of
limitations with respect to these Joint Escrow Instructions or any documents
deposited with you.

11. You
shall be entitled to employ such legal counsel and other experts as you may
deem necessary properly to advise you in connection with your obligations
hereunder, may rely upon the advice of such counsel, and may pay such counsel
reasonable compensation therefor.

12. Your
responsibilities as Escrow Agent hereunder shall terminate if you shall cease
to be an officer or agent of the Company or if you shall resign by written
notice to each party. In the event of any such termination, the Company shall
appoint a successor Escrow Agent.

13. If
you reasonably require other or further instruments in connection with these
Joint Escrow Instructions or obligations in respect hereto, the necessary
parties hereto shall join in furnishing such instruments.

14. It
is understood and agreed that should any dispute arise with respect to the
delivery and/or ownership or right of possession of the securities held by you
hereunder, you are authorized and directed to retain in your possession without
liability to anyone all or any part of said securities until such disputes
shall have been settled either by mutual written agreement of the parties

-2-

concerned or by a final order, decree or judgment
of a court of competent jurisdiction after the time for appeal has expired and
no appeal has been perfected, but you shall be under no duty whatsoever to
institute or defend any such proceedings.

15. Any
notice required or permitted hereunder shall be given in writing and shall be
deemed effectively given upon personal delivery or upon deposit in the United
States Post Office, by registered or certified mail with postage and fees
prepaid, addressed to each of the other parties thereunto entitled at the
following addresses or at such other addresses as a party may designate by ten
days’ advance written notice to each of the other parties hereto.

16. By
signing these Joint Escrow Instructions, you become a party hereto only for the
purpose of said Joint Escrow Instructions; you do not become a party to the
Agreement.

17. This
instrument shall be binding upon and inure to the benefit of the parties
hereto, and their respective successors and permitted assigns.

-3-

18. These
Joint Escrow Instructions shall be governed by, and construed and enforced in
accordance with, the internal substantive laws, but not the choice of law
rules, of California.

Very truly
yours,

BROCADE
COMMUNICATIONS SYSTEMS, INC.

Signature

Print Name

Title

PURCHASER:

Signature

Print Name

Address:

ESCROW AGENT:

[Escrow Agent
Name]

Signature:

Print Name:

Title:

-4-

EXHIBIT A-4

CONSENT OF SPOUSE

I, ,
spouse of ,
have read and approve the foregoing Restricted Stock Purchase Agreement (the
“Agreement”). In consideration of the Company’s grant to my spouse of the right
to purchase shares of Brocade Communications Systems, Inc., as set forth in the
Agreement, I hereby appoint my spouse as my attorney-in-fact in respect to the
exercise of any rights under the Agreement and agree to be bound by the
provisions of the Agreement insofar as I may have any rights in said Agreement
or any shares issued pursuant thereto under the community property laws or
similar laws relating to marital property in effect in the state of our
residence as of the date of the signing of the foregoing Agreement.

Dated: ,

Signature of
Spouse

EXHIBIT A-5

ELECTION UNDER SECTION 83(b)OF THE INTERNAL REVENUE CODE OF 1986

The undersigned taxpayer
hereby elects, pursuant to Section 83(b) of the Internal Revenue Code of 1986,
as amended, to include in taxpayer’s gross income for the current taxable year
the amount of any compensation taxable to taxpayer in connection with his or
her receipt of the property described below:

1.

The
name, address, taxpayer identification number and taxable year of the
undersigned are as follows:

NAME:

TAXPAYER:

SPOUSE:

ADDRESS:

IDENTIFICATION
NO.:

TAXPAYER:

SPOUSE:

TAXABLE YEAR:

2.

The
property with respect to which the election is made is described as follows:
shares
(the “Shares”) of the Common Stock of Brocade Communications Systems, Inc.
(the “Company”).

3.

The
date on which the property was transferred is: , .

4.

The
property is subject to the following restrictions:

The
Shares may be repurchased by the Company, or its assignee, upon certain events.
This right lapses with regard to a portion of the Shares based on the
continued performance of services by the taxpayer over time.

5.

The
fair market value at the time of transfer, determined without regard to any
restriction other than a restriction which by its terms will never lapse, of
such property is:
$.

6.

The
amount (if any) paid for such property is:
$.

The undersigned
has submitted a copy of this statement to the person for whom the services were
performed in connection with the undersigned’s receipt of the above-described
property. The transferee of such property is the person performing the services
in connection with the transfer of said property.

The
undersigned understands that the foregoing election may not be revoked except
with the consent of the Commissioner.